News You Can Use: October 2017

Fundraisers Have Opportunities to Encourage “Generosity for Life”

The new “Generosity for Life” interactive web site reports an 11-percentage point decline in American households making charitable donations between 2000 – 2014. What does this mean for fundraisers?

The report is rigorous and reliable and, therefore, is useful for your fundraising planning. But how?

The report’s findings serve as a reminder to stay close to your donors with consistent stewardship and communication. Continue to take all appropriate steps to encourage your donors to stay engaged.

The report also reminds us that new donor acquisition is never-ending, and now more than ever. Prospect lists from board members, former board members, staff members, volunteers and current donors can lead to new donations. Direct mail, special events and social media (including the recent surge in crowdfunding) also can identify new donors.

How does this national trend align – or not – with your nonprofit’s recent experience with donor acquisition and retention? You always should be keeping a close watch on your donor database. If a consistent donor from the last few years suddenly stops donating, you can contact them and politely ask, “Why?”

As you learn more, you can explore ways to invite the former donor to stay engaged through your normal communication channels (e-newsletters, social media, mailings and so forth), while inviting the former donor to stay on the guest list for your future events. Keeping the person engaged might restore their charitable giving in the future.

While you stay close to your donors, stay close to your fundraising methods. The need to constantly test, review, and evaluate each of your fundraising activities has never been greater. For example, what was the ROI on your last direct mail letter? Is your special event producing new donors and new friends as you anticipated? Plan. Implement. Assess.

Is your case statement up-to-date? Be sure your case for support includes the latest data on external conditions and program results, information about how your nonprofit is distinct and impactful, and explanations for why a donor should care.

Ensure that donating to your nonprofit is as convenient as possible. Allow donors to have many options for providing their gift: cash, checks, credit cards, APPs, and electronic fund transfers, just to name a few!

And gifts of stock to name another. The significant growth of the stock market since 2009 means donors will receive two tax advantages from making an annual fund or major gift from their stock portfolio. The donor would not need to pay capital gains tax on the increased value of the stock, and the donor receives a charitable deduction for the value of the stock. Are you talking to prospective and current donors about gifts of stock?

Are you asking your donors if their employer matches their gift? Many businesses are doing so as a way to bolster employee engagement and satisfaction. This simple step could help you increase donations from your current base of donors.

Do your annual fund appeals include an option for “monthly giving?” Monthly donors can be more likely to continue donating for longer time periods than donors who provide one gift each year.

Some nonprofits are hesitant to invite their volunteers to donate thinking, “They already have donated their time.” But this is exactly why volunteers should be invited to make a financial donation. According to the Corporation for National Service, as many as 80 percent of your volunteers – if led and managed well – could become donors.

Speaking of volunteers, if more nonprofits had 100 percent board giving, the trend reported by “Generosity for Life” likely would reverse rapidly! If you are not there with your board just yet, aspire to do so, one board member and one step at a time.

And then use any new momentum to engage the board in recommending new prospects and cultivating new donors.

Despite the trend reported by “Generosity for Life,” individual donors – by far – remain the largest source of charitable donations. That said, remember to diversify, diversify, diversify. Charitable giving from foundations and the business sector in 2016 increased much faster than the rate of inflation and remain strong options to supplement and complete your fundraising efforts.

While the “Generosity for Life” trend is reported through 2014, the Giving USA report for 2016 revealed a record amount of charitable giving – even after adjusting for inflation. In fact, charitable donations to all nine subsectors analyzed by Giving USA increased faster than the rate of inflation – only the sixth time in 50 years that this remarkable generosity has occurred. This is still a good time to be a fundraiser!

Consider this new report in the context of recent economic reports that historically have been associated with charitable giving. For example, U.S. household wealth, employment, underemployment, wages and the stock market currently are trending in positive directions. This could bode well for current and future fundraising. Stay tuned to the latest research - including Giving USA, the Philanthropy Outlook Study, the “Generosity for Life” web site and other reports from the Indiana University Lilly Family School of Philanthropy – for the latest trend data.

The donor trend reported by “Generosity for Life” is a reminder to keep your fundraising skills sharp and up-to-date with continual professional development and training. For example, in-person and online courses, custom training, low-cost webinars and the Leadership Roundtable – all from The Fund Raising School – can help you maximize fundraising opportunities.